Highlights
Selva Malvezzi Production Concession – PVE (operator) 63% Interest
• PM1 well has performed very consistently during confirmatory program.
• Production levels tested at various rates from ~42,000 scm/day to ~62,000 scm/day during the
quarter.
• Following favourable final test results in January, production has been set to ~78,000-80,000
scm/day post-quarter end.
• PM1 is supplying the gas to BP Gas Marketing under an 18-month supply agreement.
• Gas prices remain volatile with the current TTF spot price of ~€0.325/cm which is ~19% lower
than the €0.40/cm weighted average price received during the quarter.
• Quarterly production was 4,180,015 scm of gas (on a 100% basis) and revenue for the quarter
ending 31 December 2023 was €1,773,302 (on a 100% basis).
Next steps
• Po Valley Energy continues to advance other projects within the Selva Malvezzi Production
Concession and explore realising maximum value for the remainder of its Italian gas portfolio.
Corporate
• Operating cashflow for the quarter was €940k (net to PVE), with a one-month lag between
revenue and cash receipts due to normal trading terms with BP Gas Marketing.
• Cashflows in relation to development costs were €269k (net to PVE), representing the final
payments for the PM1 gas plant and pipeline and improvements.
• Cash at 31 December 2023 €1,253k (A$2,030k).
Australia's Po Valley Energy Limited ("Po Valley" or "The Company") is pleased to provide its
Quarterly Activities Report for the period ending 31 December 2023, covering the Company's gas
exploration, development and production outcomes across its onshore and offshore assets in northern
Italy.
Selva Malvezzi
Selva is an onshore natural gas field in the eastern part of the Po Plain, among the Ferrara and Bologna
provinces, in the Emilia Romagna Region. The production concession measures 80.68 sq km and has been
carved out from the former Podere Gallina Exploration Permit.
PM1 gas production and well management
Gas production at its 63%-owned Podere Maiar – 1 (PM1) gas facility in the Selva Malvezzi Production
Concession, located in the Po plain of northern Italy for the quarter is shown in the table below:
Po Valley subsidiary, Po Valley Operations Pty Ltd (“PVO”), operator of the Selva Malvezzi Production
Concession Joint Venture, is particularly pleased with PM1 well performance to date. Regardless of choke
setting, production has been very consistent as has tubing head pressure. Choke levels in the quarter were
set at various levels ranging from ~42,000 – 62,000 scm/day as part of confirmatory programme. Other
gas volume variances across the quarter were a function of minor SNAM grid pressure variations.
During the quarter, PVO carried out two slick line operations, the first in early November and the second
in mid-December. Bottom hole pressure and temperature readings in static conditions were in line with
expectations and monitoring for any debris accumulation were completed to ensure no accumulation
issues were evident.
PVO completed two further slick line operations in January 2024 with results confirming no debris
accumulation. With the well performance in line with expectations, choke levels have been set to produce
~78,000 to 80,000 scm / day post-quarter end.
PM1 Gas is supplied to BP Gas Marketing under an 18-month supply agreement. Invoicing cycles being
managed by PVO on behalf of the Selva Malvezzi Production Concession Joint Venture are progressing
seamlessly. Revenue for the quarter ending 31 December 2023 was €1,773,302 (100%).
Net cash outflows for development costs totalled €269k (net to PVE) for the quarter which included the
final instalment on the construction costs, meeting all the payment obligations for the costs in accordance
with the plant construction agreement and also include improvements on site.
The Selva Malvezzi Production Concession is the key area of focus for the Company with the next stages
of development including drilling programmes at Selva North, South and East and a potential seismic
programme over the licence area currently being assessed, including the Riccardina prospect. Initial
interaction and discussions with landholders near the North / South and East drilling prospects have
commenced and been very positive. The Company looks forward to providing timing guidance on these
next steps as these assessments are completed.
Kevin Bailey, Po Valley Chairman, stated that “the PVE board are pleased with the performance of the well
to date and the excellent work being undertaken by our Italian team. The diligent monitoring and
maintenance of the well performance and production facilities sets a solid platform for continued
optimum production over the long term.”
Other Assets
The Company continues to assess how best to realise value from its 100%-owned Teodorico (d.40.AC-PY)
off-shore asset, either via a joint venture or sale. In addition, the company is reviewing optimal
development paths for its residual assets (Cadelbosco di Sopra, Grattasasso and Torre del Moro) including
the potential for introduction of third-party investors/ partners who have interest in participating in their
development.
Cadelbosco di Sopra and Grattasasso are shallow gas opportunities which fit neatly with the Company’s
proven exploration and development capabilities whilst Torre del Moro is a large deep gas prospect.
CORPORATE
Cash flow
Net operating cashflows for the quarter were €940k, which included receipts from gas sales of €1,277k
and production operating costs of €149k. Development cost cash outflows for the PM1 well site of €269k
in the quarter are in accordance with the payment terms of the construction contract. Receipts and costs
are net of any Joint Venture Partner contribution or distributions. Joint Venture Partner interest is 37%.
The Group’s cash balance at 31 December was €1,253k (A$2,030k).
Regarding Section 6.1 of the Appendix 5B payments totalling €35k made to related parties and their
associates during the quarter, the Company advises these payments consisted of current director fees for
the quarter.
Information Provided in Accordance with ASX Listing Rules 5.4.1 and 5.4.2
In accordance with ASX Listing Rule 5.4.1, the Company confirms that, other than the development and
production underway at the Podere Maiar-1 well site, there have been no material developments or
changes to its exploration or production activities. As the focus in this quarter was monitoring and
managing initial gas production at the Poder Maiar-1 gas plant and pipeline, there were no other
substantive exploration activities or costs incurred during the quarter.
In accordance with ASX Listing Rule 5.4.2, the Company advises that the development and production
activities undertaken at the Podere Maiar-1 site and costs incurred are as described in the relevant
sections above.
This announcement was approved for release by the Board of Directors of Po Valley Energy Limited